What’s in it for me? Learn about the economic right’s takeover of America.
America is known as the land of opportunity – a beacon of hope for democracies all across the world. Well, it used to be at least. So what’s changed? Quite simply, the United States has started to look backward, to the bad old days when robber barons and a tiny aristocracy owned the greatest share of wealth and controlled political power.
It’s an old story. A powerful elite has taken too much for itself, while everyone else struggles. Unable to find secure work, housing, and health care, many Americans today must be wondering what happened to their great country. And that’s just what we’ll find out in these blinks, which examine the shadowy plots, leading political figures, and economic ideologies that have led the US to its current predicament.
In these blinks, you’ll learn
how nostalgia signaled the end of progressive politics in the US;
why liberals became complacent; and
why we’re still living, in a very real sense, in the 1980s.
Since the end of the twentieth century, America has become more nostalgic – and stagnant.
America was once the land of tomorrow. Leaving the old monarchies and traditions of Europe behind, it looked toward new horizons. New religions, new inventions, and new enterprises all flourished.
The twentieth century brought radical change, too – think space travel, rock and roll, and the civil rights movement. But sometime at the end of the last century, this drive toward modernity began to slow down.
The key message here is: Since the end of the twentieth century, America has become more nostalgic – and stagnant.
Author Kurt Andersen first noticed this in 2007, when he came across a newspaper photograph from twenty years earlier. The photo showed some stylish-looking people standing around on a US city street. Studying their clothes and hairstyles, he noticed how similar they looked to people in 2007.
This led him to something of an epiphany. Looking at cars, fashion, music, and design in 2007, he realized how little things had fundamentally changed since 1987. Aside from mobile phones or computers, there was very little in 2007 that looked or sounded new.
By contrast, the twentieth century ushered in one radically new cultural era after another. Just think of the dramatic transition from 1955 to 1965 – the freedom-fueled music and fashion of the 1960s were worlds apart from the conservative norms of the 1950s. So what happened?
Well, quite simply, America has abandoned the new and embraced nostalgia. This turn toward nostalgia began as early as the 1970s. Just after the radical changes of the 1960s, a great chunk of the American public started to quietly long for the past – or, more accurately, an imagined past, where everything felt more familiar and stable.
This could be seen in the mass popularity of movies and TV shows of the period, like Grease, American Graffiti, and Happy Days, which were all set in idealized versions of the 1950s and early ’60s.
This desire for nostalgia in the US hasn’t slowed as we’ve moved further into the twenty-first century. Aside from technological advances, cultural change seems to be at a standstill. Fashion, music, and design are still repeating styles from different periods in the twentieth century. Retro is cool.
Why does this matter? Well, it reflects a broader impasse that goes way beyond fashion or music. It tells us that America is stuck in a time warp, both politically and economically. And with the problems the country faces, like inequality and climate change, it simply can’t afford to look backward.
Nostalgia opened the door to the economic right.
After President Franklin D. Roosevelt introduced the New Deal in 1932, the US became a modern, center-left country that looked after its citizens. The New Deal helped provide secure employment that brought good pensions, as well as relief for the poor and unemployed.
When Lyndon B. Johnson’s presidency ushered in a wave of liberal reforms in the 1960s, it looked like the ideas of the economic right were in permanent retreat. Anyone who proposed cutting taxes for big corporations or slashing welfare was considered a strange, fringe character.
However, just as nostalgia for the past was creeping in, the right saw an opportunity.
The key message here is: Nostalgia opened the door to the economic right.
After facing defeat after defeat on an ideological front, the right began plotting their comeback. As the radical politics of the 1960s became more mainstream, the rich, right-wing elites grew terrified that they were going to lose their privileges forever. But as mass demonstrations broke out against the Vietnam War and for civil rights, they saw an opportunity to appeal to Americans who feared all of this upheaval.
It began with the presidential campaign of Barry Goldwater, a right-wing Republican, who lost by a landslide to Democrat Lyndon B. Johnson in 1964. Despite losing, he introduced a campaign strategy that would prove successful in the future. In his half-hour campaign ad, he contrasted images of small-town American life with those of teenagers dancing to rock and roll, Black people singing in the streets, and fast cars whizzing by. He sought to appeal to people’s desire for an idealized past, which was under threat from modernity.
Then, as the 1980s approached, Republican presidential candidate Ronald Reagan perfectly harnessed this desire for nostalgia during his campaign. Rather than putting his right-wing economic policies front and center, Reagan focused on a vision of a past America. As a former Hollywood star of the 1940s, Reagan himself embodied this vision of an idealized, vanished past.
It was a brilliant strategy. The majority of Americans did still support the policies of the New Deal. They certainly weren’t for slashing taxes on the very wealthy or removing environmental and labor protections, which were both part of Reagan’s program. So instead, he focused on what they did like. And what they liked was warm, fuzzy nostalgia – white-picket-fence America, with its big lawns, gables, and newspaper boys.
Reagan won the 1980 election. And with his victory came the economic policies that rich, right-wing elites had long awaited.
Two men, Milton Friedman and Lewis Powell, were instrumental to the resurgence of the economic right in the 1970s.
As the political right plotted their comeback, there were a few especially influential figures. These were people who’d watched, with horror, as the 1960s unfolded and sentiment turned against big business and the rich. And even though their economic ideas were unpopular for decades, they hung in there. They waited for the right moment to pounce.
Two of these people would become particularly important to the economic counter-revolution.
The key message here is: Two men, Milton Friedman and Lewis Powell, were instrumental to the resurgence of the economic right in the 1970s.
First, there was Milton Friedman, an economics professor at the University of Chicago. In the fall of 1970, when it seemed that progressives had won all of the economic arguments, Friedman published an essay that would go on to shape the future. Printed in the New York Times Magazine under the title “A Friedman doctrine – The Social Responsibility Of Business Is to Increase Its Profits,” the essay argued that businesses should have no other responsibilities than accumulating profit.
Friedman’s essay made the case for coldheartedness and derided executives who pursued social responsibilities, which he thought were a disguise for anti-capitalism. The piece presented a shocking alternative view to much of the progressive thinking of the era.
And guess what? Lots of wealthy CEOs and businesspeople agreed with Friedman. They were sick of being scorned by the liberals who dominated the public conversation. Friedman’s article was a big middle finger to them all. Many of these businesspeople absorbed his every word; the text went on to shape corporate boardrooms for the next five decades. Vitally, Friedman’s thinking influenced the policies of future Republican President Ronald Reagan.
The second important figure was Lewis Powell, a top lawyer from Virginia. Troubled by the anti-capitalist mood of the 1960s, he submitted a plan of action to the US Chamber of Commerce in 1971 – to combat what he saw as subversive left-wing elements.
In this document, he proposed a campaign to infiltrate and influence academia, the media, politics, and the legal system. To do this, Powell stated that the economic right would need budgets of a size never seen before in political campaigning. Corporations who wanted to protect themselves from liberal policies should donate to fund think tanks, academics, and sympathetic journalists, who would all promote right-wing economic ideology.
This signaled another important development for the political right: the beginning of the well-funded lobbying campaigns that would dominate American politics right into the twenty-first century.
Friedman and Powell, in their different ways, were key to the march of the new right.
The right adopted some strategies of their political opponents to gain power.
When you think of the radical elements of the 1960s, you probably have a few images in mind. Maybe you see hippies at Woodstock tripping on LSD. Perhaps you picture student protestors demonstrating against the government, or the banners and slogans of the anti-nuclear campaigns.
Funnily enough, the opponents of all of this radicalism – the kinds of conservatives we’ve met in the previous blinks – ended up stealing some of its ideas and campaigning styles.
The key message here is: The right adopted some strategies of their political opponents to gain power.
Rather than presenting themselves as stuffy, old-fashioned conservatives, the new political right tapped into the spirit of the time. Take the ultra-individualism of the 1960s. During those days, people, especially young people, reacted against the conformism of post-war America by becoming even more individualistic. As hippies were exploring their individual freedom and finding their own truths, the new breed of right-winger, like Milton Friedman, encouraged his readers to do the same.
Friedman encouraged them not to feel ashamed by their desire to become wealthy or pursue profits without a social conscience. Like the hippies, they should do what felt right to them. After all, libertarianism, which was what this kind of low-tax economics was called, was about personal freedoms.
Another element of the 1960s and ’70s that the right adopted was a mistrust of government. Following the Vietnam War and the Watergate scandal, trust in government – and authority in general – was plummeting.
This fit the right’s economic narrative perfectly, as they believed that the State should stay as far away from people’s lives as possible. So, rather than contesting the popular feeling that the government was corrupt, they encouraged it. They wanted to see a roll back of the State and widespread deregulation, so businesses could do what they liked.
In fact, in Ronald Reagan’s inaugural address, he said: “Government is not the solution to our problems; government is the problem.”
Finally, in another echo of the liberal campaigners, there were those like Lewis Powell, the Virginian lawyer, who tried to paint wealthy businessmen as victims. He wrote, “The American business executive is truly the forgotten man,” which mirrored, in a perverse and distorted way, the language of those campaigning for the rights of minorities and vulnerable people.
All of these tactics, as cynical as they were, only helped the cause of the libertarian right – resulting in their great victories of the 1980s.
The American right’s success owes a great deal to liberal complacency.
At a certain point in time, it must’ve seemed to American liberals that they had won most political arguments. The logic of the New Deal, with its secure employment, strong labor unions, and relief for the poor, had become embedded into American society. And even though there was some way to go on race, gender, and sexuality, progress had been made.
So, fatefully, after the 1960s, American liberals became complacent – and let their guard down.
The key message here is: The American right’s success owes a great deal to liberal complacency.
First, let’s think back to the nostalgia we’ve talked about already. It wasn’t only those who were scared of the radicalism of the 1960s that turned to nostalgia; progressives did it, too. During the 1980s, lots of people, including many affluent liberals, began to adopt past fashions and customs as a kind of quirk. For instance, rather than enjoy the modern, global cuisine now available in the US, many began to turn, half-jokingly, to “comfort food” – traditional American home-cooking.
Although the embrace of comfort food seemed like a harmless fad, it disguised something more serious – lots of people, including liberals, longed for the past. A past that was less radical, more steady, and more white.
That instinct can also be seen in the popularity of a book called The Official Preppy Handbook, which not only satirized the archaic habits of rich white college students but also made them popular.
The ironic embrace of nostalgia by liberals allowed the mood to become mainstream. And so, when right-wing politicians like Ronald Reagan began appealing to that nostalgia, they were very successful.
After the 1960s, some liberals became disenchanted with labor unions, which weren’t always forthcoming with their support for minorities and women. In fact, many liberals found labor unions to be full of old-fashioned bigotry. So when the political right sought to crush the unions in the 1980s, there was little solidarity with them; many liberals were happy to see them go. And just like that, another protection against the corporate elite was stripped away.
Then, some liberal outlets and institutions gave space to the new ideas of the right, to show how broad-minded and magnanimous they were. The New York Times hired William Safire, Richard Nixon’s right-wing speechwriter, as a columnist. Harvard employed two stars of this new right-wing movement, Robert Nozick and Martin Feldstein, as professors. To cap it all off, Nobel Prizes for economics went to Milton Friedman and his mentor, Friedrich Hayek. From the fringes, these right-wingers had invaded the liberal mainstream.
All of this complacency meant that when Ronald Reagan was elected president, he found little resistance to his most radical reforms.
The political changes set in motion by the economic right in the 1980s still affect the US today.
We’ve established that the 1980s in America was the moment when capitalism was unleashed – when unadulterated greed was allowed free rein.
However, behind the ostentation of the decade, the economic right forced lots of quieter changes, whose consequences we’re still experiencing today. The 1980s, in many ways, have never really ended.
The key message here is: The political changes set in motion by the economic right in the 1980s still affect the US today.
With Reagan’s election came the normalization of the economic right’s worldview. As we learned in the previous blink, the ideas of people like Milton Friedman became mainstream. Certain norms were completely changed, almost overnight. Rather than being skeptical of greed and big business, as had been the trend, many people now openly celebrated greed and showed deference to business.
How did this happen? Well, remember the quiet plotting by the right we discussed earlier? In the 1970s, they launched a massive campaign through academia, media, politics, and the legal system. By the 1980s, this campaign had begun to bear fruit. It had taken a long time, but the right’s ideas had finally entered the public consciousness.
Many of the other changes that occurred in the 1980s seemed boring and procedural, but they had lasting effects on America.
First, Reagan’s administration started quietly “forgetting” to update certain codes and regulations. This meant that things like, say, violations of labor laws were ignored. It meant that CEOs were allowed to gift themselves company stock without it being counted toward their salaries. It meant slight modifications to tax laws, which protected the wealthy from paying more Social Security taxes.
These might’ve seemed like little things at the time, but cumulatively, they were enormous. The overall effect was to benefit the wealthy and big business, and remove rights and protections from everyone else.
Then, during the 1980s, the economic right sought to change the judiciary. They knew that they couldn’t rely on having a sympathetic president or Congress forever; they needed to make more lasting change. So they sought to infiltrate the legal community by building up a cadre of like-minded, right-wing lawyers. In 1982, the right created a group called the Federalist Society, which advocated for conservative views and presented suitable Supreme Court nominees for Republican presidents.
In time, they were successful at embedding conservative views in the Supreme Court – views that considered hard-core free-market economics as part of America’s legal DNA. Again, by stealth, the economic right had taken an enormous step in solidifying their power.
One of the results of the right’s victories in the 1980s was the birth of financialization.
With the 1980s came the birth of the archetypal Wall Street shark. In the 1987 film Wall Street, these sharks are personified by Gordon Gekko, a coldhearted financier who declares, “Greed is good.”
As well as depicting the greed of the 1980s, a character like Gekko symbolizes a change in the economic structure of the US. Whereas before, the country had focused on making and manufacturing things, a great chunk of the economy was now based entirely on financial speculation.
This was the financialization of the American economy. And it had been driven, in large part, by the economic agenda of the political right.
The key message here is: One of the results of the right’s victories in the 1980s was the birth of financialization.
The consequences of this financialization were manifold. The most obvious is the ready embrace of risk. When Reagan was elected, he cut capital gains tax drastically, so that investors were able to keep more of their profits. This led to an enormous gain in share prices from 1982 onward, as lots of people saw the stock market as a quick way to get very rich. So investors piled in, making and losing billions of dollars.
This wasn’t where the risk stopped, though. Deregulatory policies by Reagan’s administration meant that it was easier than ever for working-class Americans to borrow on credit cards and take out risky loans. This led to many people, already on the breadline, getting into enormous debt.
This same deregulation paved the way for even higher risk-taking later in the twentieth century. This came through the use of financial instruments that were increasingly detached from actual businesses and commodities. These were high-risk derivatives, which had little to do with direct investment in anything real.
While this was happening, businesses themselves were becoming hollowed out by a focus on the stock market. The notion of shareholder value became important, which meant that rather than considering their long-term future, businesses grew obsessed with creating short-term shareholder profits.
The financialization of the 1980s turned a country renowned for its innovation into one focused on immediate gratification. It turned a manufacturing society into a giant casino, where ordinary Americans fell into enormous debt while the wealthy grew even wealthier through speculation.
America must reform dramatically – or face a dystopian future.
For many Americans today, this lengthy campaign by the economic right has resulted in a more precarious existence – one in which secure work, housing, and health care are hard to come by. Rather than Roosevelt’s New Deal, they’ve got a Raw Deal.
And the future looks scary. In the worst-case scenario, they will be rendered obsolete in an increasingly automated workplace, while the elite class grows wealthier off the profits.
The key message here is: America must reform dramatically – or face a dystopian future.
If things continue down this path, with more power and privilege handed to powerful corporations, the coming decades will be dystopian.
However, another future is possible. Technology could set Americans free. By letting robots do the repetitive, dreary jobs, people could be free to spend more time doing the things they want to do and excel at. In fact, the giant warehouses of Amazon and Walmart are already using automated help, which performs the job of sorting much more efficiently than any human could.
That’s all very well, you might say, but what happens to the workers who are laid off? How are they supposed to make ends meet? Well, as automation increases productivity, there should be enough national wealth for everyone to lead secure, contented lives. The answer, then, is a universal basic income. By paying every American a lump sum every month to cover the cost of living, they’ll be shielded from the fall-out of this automation revolution.
And luckily, there’s an example of something very similar already functioning in the US. This is the Alaskan oil dividend, which pays out a variable sum to every Alaskan, depending on the profits from the lucrative oil business in the state. Although not exactly a universal basic income, it offers us an insight into people’s fates when they receive a state income like this. The results are uplifting. Rather than ceasing to work, many people have taken on more work – especially women with children, who can now afford childcare. In addition, the extra income has resulted in better general nutrition, fewer underweight newborns, and it has lifted a third of Alaska’s Native citizens out of poverty.
America is presented with two choices: continue in the backward direction set by the economic right, which will lead to greater inequality and misery, or reform dramatically. America needs to face the future once again.
Final summary
The key message in these blinks:
Following the radical politics of the 1960s, American society became nostalgic. This presented an opportunity for the right, who’d been losing the economic argument to liberals for decades. They appealed to Americans’ fondness for the “good old days.” When they seized power in 1980 with Ronald Reagan’s election, they brought in their radical reforms – deregulating, slashing taxes, and changing the judiciary to reflect their aims. America, right up to the modern day, has been affected by their legacy.
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What to read next: Fantasyland, by Kurt Andersen
You’ve learned how, in the US, the power of nostalgia has translated into political reality – how, after the radicalism and upheavals of the 1960s, many Americans yearned for the comfort food and old-fashioned stability of the past.
Well, what about the power of fantasy? Just as nostalgia plays its part in America’s present, so does fantasy. From the Salem Witch Trials to conspiracy theories, the experimental 1960s to the obsession with aliens, the US is built on big stories. Check out the blinks to Fantasyland to get a vivid picture of a country where fact and fantasy can become perilously blurred – and where a man like Donald Trump can fabricate his way to the presidency.